Friday, July 15, 2016

A
year ago many market bellwethers had broken down below long term moving
averages. The term Bellwether – was derived from the Middle English Bellwether
which refers to the practice of placing a bell around the neck of a castrated
ram – (a wether) in order that this animal might lead its flock of sheep.

The
Goldman Sachs Group Inc (GS) is a component of the Financial Select Sector SPDR
ETF (XLF). Goldman leads most bull and bear market cycles having peaked in
October 2007 and bottoming in November 2008. Goldman has completed a short 2015
bear phase and should lead the XLF higher through 2016 + thanks to
Stockcharts.com for the point & figure

Wednesday, July 6, 2016

Paul Anthony Samuelson was an American economist and
the first American to win the Nobel Memorial Prize in Economic Sciences. His
textbook Economics (ISBN- 0-07-0 092863-0) has become a classic in which he
states in a chapter entitled “Central Problems of Every Economic Society” that
a nation has to choose between two options when spending its finite resources.
It may buy either guns (invest in defense/military) or butter (invest in
production of goods), or a combination of both.

U.S. President Lyndon B. Johnson used the phrase to
catch the attention of the national media, while reporting on the state of
national defense and the economy. Another use of the phrase was British Prime
Minister, Margaret Thatcher's reference in a 1976 speech that, "The
Soviets put guns over butter, but we put almost everything over guns.”

The US seems to favour Gums over Butter – so why not
drill down into the sector and seek out the Aerospace and Defense names – In
the U.S.
there are lots of aerospace & defense related companies - L-3
Communications Holdings Inc. (LLL), Lockheed Martin Corp (LMT), United
Technologies Corp (UTX), Honeywell International (HON), Boeing Co/The (BA). General
Dynamics Corp (GD), Raytheon Co (RTN) and Northrop Grumman Corp (NOC). Many of
these names are at or close to new 52-week highs.

In Canada
the choices are slim with a few thin traders – such as Magellan Aerospace (MAL)
and Heroux-Devtek Inc (HRX). We are left with CAE Inc (CAE) a liquid pure
aerospace play. Our chart – monthly of LMT displays a pending new bull cycle –
recent all-time highs and strong money flow numbers

About Me

Bill has been writing a weekly business column in the Toronto Star since 1997, and was an early contributor to the former “Report on Business Television”. He has founded the Getting Technical Market Newsletter in December 1998.
Bill is also an Instructor for the Canadian Securities Institute. He is also a contributing author of the textbook for the technical analysis course offered by the Canadian Securities Institute (CSI. He is also called upon to provide training to industry professionals on technical analysis at many of Canada’s leading brokerage firms.
In February 2010 Bill became a technical sub-advisor to Stonebrooke Asset Management Ltd. who manages the Hybrid Investment Program under the Elite Wealth Strategies program for Union Securities Ltd..
The relationship ended in Feb 2012 but over the 24 month period the Hybrid Program enjoyed five technical selections that were the subject of takeover bids namely, Gerdau Ameristeel, El Paso Corp, Biovail Corp. Viterra Inc. and ShawCor Ltd